Pakistan Pharma Industry Opposes Changes To Drug Pricing Policy

Pakistan’s pharmaceutical industry is opposing proposed changes to the country’s drug pricing mechanism. Officials from the industry warn that frequent policy shifts could disrupt medicine supplies, hurt investment, and weaken efforts to keep essential medicines affordable. They state that the Drug Pricing Policy 2018 was developed following stakeholder consultations and endorsed by the Supreme Court.

The industry’s response comes after Federal Minister for Economic Affairs and Establishment Senator Ahad Cheema instructed the health ministry and the Drug Regulatory Authority of Pakistan (DRAP) to revise the pricing framework, including the Hardship Policy and DRAP Policy Board.

Under the current policy, the government regulates prices for essential and life-saving medicines, accounting for around 40 percent, or approximately 500 molecules, of medicines sold in Pakistan. The policy permits annual price increases of up to 70 percent of Consumer Price Index (CPI) inflation and benchmarks prices against India, Bangladesh, and Sri Lanka.

Industry representatives note that essential medicine prices have only been raised by a maximum of 4.9 percent in the fiscal year 2026, compared to 7 percent CPI inflation, and remain below prices in neighboring countries. They argue that the existing system offers a transparent framework while considering the industry’s higher production costs.

The industry advises the government to retain the current pricing and hardship mechanisms for a longer duration, claiming that repeated interventions create uncertainty and could impact medicine availability, quality, investment, and exports. Officials from the sector express that profit margins have increased from about 3 percent two years ago to around 10 percent since the 2024 deregulation of non-essential medicines.

They cite India’s pharmaceutical exports, which they estimate to be around $30 billion in 2026, as evidence that consistent pricing policies and greater deregulation can foster industry growth. The industry expresses concern that tighter margins could diminish companies’ capacity to invest in production, enhance quality, and expand exports.

They argue that deregulation of non-essential medicines has also intensified competition on prices and quality, asserting that competition ultimately benefits patients while allowing pharmaceutical companies to generate sufficient funds to reinvest in the sector.